BILL NUMBER: AB 1638	CHAPTERED  10/10/99

	CHAPTER   929
	FILED WITH SECRETARY OF STATE   OCTOBER 10, 1999
	APPROVED BY GOVERNOR   OCTOBER 10, 1999
	PASSED THE ASSEMBLY   SEPTEMBER 2, 1999
	PASSED THE SENATE   AUGUST 30, 1999
	AMENDED IN SENATE   JUNE 23, 1999
	AMENDED IN ASSEMBLY   MAY 6, 1999
	AMENDED IN ASSEMBLY   APRIL 14, 1999

INTRODUCED BY   Committee on Revenue and Taxation (Knox (Chair),
Kaloogian (Vice Chair), Aroner, Briggs, Ducheny, Honda, and Romero)

                        MARCH 3, 1999

   An act to add Section 15620.5 to the Government Code, and to amend
Sections 8262, 8269, 9262, 9269, 9275, 30458.2, 30458.9, 30459.5,
32462, 32469, 32475, 38621, 40202, 40209, 40215, 41162, 41169, 41175,
43513, 43520, 43526, 45858, 45865, 45871, 46613, 46620, 46626,
50112.2, 50156.2, 50156.9, 50156.15, 55323, 55330, 55336, 60623, and
60630 of, and to add Sections 6832.5, 6902.4, 7658.1, 8174, 8878.5,
9033, 9184, 9272.1, 11253, 11254, 11409, 30283.5, 30354, 30384,
30459.2A, 32256.5, 32389, 32432, 32472.1, 38455, 38504, 38505, 38624,
40103.5, 40167, 40212.5, 41097.5, 41127.6, 41172.5, 43158.5, 43448,
43484, 43523.5, 45156.5, 45609, 45752, 45868.5, 46157.5, 46464,
46544, 46623.5, 50112.4, 50138.6, 50150.5, 50156.17, 55046, 55209,
55262, 55333.5, 60212, 60493, 60564, 60632.1, 60633.1, and 60633.2
to, the Revenue and Taxation Code, relating to taxation.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1638, Committee on Revenue and Taxation.  State Board of
Equalization:  sales and use taxes:  excise and special taxes.
   The Sales and Use Tax Law provides that the State Board of
Equalization may, in its discretion, enter into a written installment
payment agreement with a person for the payment of any taxes due,
interest, and applicable penalties, in installments over an agreed
period.
   This bill would require the board to provide each taxpayer who has
an installment payment agreement in effect with an annual statement
specifying certain information.
   The Sales and Use Tax Law establishes specified limitation periods
for the approval by the State Board of Equalization of any refund
for an overpayment.
   This bill would suspend that limitation period during any period
of a person's life that the person is "financially disabled," as
defined.
   The State Board of Equalization administers various excise and
special tax laws, including the Motor Vehicle Fuel License Tax Law,
the Use Fuel Tax Law, the Private Railroad Car Tax Law, the Cigarette
and Tobacco Products Tax Law, the Alcoholic Beverage Tax Law, the
Timber Yield Tax Law, the Energy Resources Surcharge Law, a taxpayer'
s bill of rights law, the Emergency Telephone Users Surcharge Act,
the Hazardous Substances Tax Law, the Integrated Waste Management Fee
Law, the Oil Spill Response, Prevention, and Administration Fees
Law, the Underground Storage Tank Maintenance Fee Law, the Fee
Collection Procedures Law, and the Diesel Fuel Tax Law.
   This bill would provide for purposes of one or more of those laws,
as applicable, that the board may establish a uniform policy for the
acceptance of specified documents, relieve certain interest imposed
on a person if the failure to pay tax is due to an unreasonable error
or delay by an employee of the board, make technical changes to the
board's education and information programs, specify that a taxpayer
is entitled to reimbursement of fees and expenses for a hearing
before the board if, among other things, a claim is made within one
year of the date the decision of the board becomes final, authorize
the board to enter into written installment payment agreements,
require the return of property levied upon under certain
circumstances, allow the board an alternative procedure with respect
to the recovery of certain erroneous refunds or credits, and allow
the board to release or subordinate certain liens if the board
determines that the release or subordination will facilitate the
collection of tax or will be in the best interest of the state and
the taxpayer.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 15620.5 is added to the Government Code, to
read:
   15620.5.  The board, whenever it deems it necessary to ensure
voluntary compliance with the due dates prescribed by law for
submission of any remittance, claim for credit or refund, document,
return, or other information delivered to the board through the
United States mail or through a bona fide commercial delivery
service, may establish a uniform policy for the acceptance of the
remittance, claim for credit or refund, document, return, or other
information in cases where the cancellation mark stamped upon the
envelope containing the remittance, claim for credit or refund,
document, return, or other information shows a date after the date
specified in law.  This policy shall not be construed as an extension
of the prescribed time limits for remitting payments, filing claims
for refund or credit, submitting documents, returns, or other
information.
  SEC. 1.5.  Section 6832.5 is added to the Revenue and Taxation
Code, to read:
   6832.5.  On or before July 1, 2000, the board shall provide each
taxpayer who has an installment payment agreement in effect under
Section 6832 with an annual statement setting forth the initial
balance at the beginning of the year, the payments made during the
year, and the remaining balance as of the end of the year.
  SEC. 1.7.  Section 6902.4 is added to the Revenue and Taxation
Code, to read:
   6902.4.  (a) The limitation period specified in Section 6902 shall
be suspended during any period of a person's life that the person is
financially disabled.
   (b) (1) For purposes of subdivision (a), a person is financially
disabled if the person is unable to manage his or her financial
affairs by reason of medically determinable physical or mental
impairment of the person that can be expected to result in death or
that has lasted or can be expected to last for a continuous period of
not less than 12 months.  A person shall not be considered to have
an impairment unless proof of the existence thereof is furnished in
the form and manner as the board may require.
   (2) A person shall not be treated as financially disabled during
any period that the person's spouse or any other person is authorized
to act on behalf of the person in financial matters.
   (c) This section applies to periods of disability commencing
before, on, or after the effective date of the act adding this
section, but does not apply to any claim for refund that, without
regard to this section, is barred by operation or rule of law,
including res judicata, as of the effective date of the act adding
this section.
  SEC. 1.9.  Section 7658.1 is added to the Revenue and Taxation
Code, to read:
   7658.1.  (a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by Sections 7655 and 7661
where the failure to pay tax is due in whole or in part to an
unreasonable error or delay by an employee of the board acting in his
or her official capacity.
   (b) For purposes of this section, an error or delay shall be
deemed to have occurred only if no significant aspect of the error or
delay is attributable to an act of, or a failure to act by, the
distributor.
   (c) Any person seeking relief under this section shall file with
the board a statement under penalty of perjury setting forth the
facts on which the claim for relief is based and any other
information which the board may require.
   (d) The board may grant relief only for interest imposed on tax
liabilities that arise during taxable periods commencing on or after
January 1, 2000.
  SEC. 2.  Section 8174 is added to the Revenue and Taxation Code, to
read:
   8174.  (a) Notwithstanding any other provision of this part, if
the board finds that neither the person liable for payment of tax nor
any party related to that person has in any way caused an erroneous
refund for which an action for recovery is provided under Section
8171, no interest shall be imposed on the amount of that erroneous
refund until 30 days after the date on which the board mails a notice
of determination for repayment of the erroneous refund to the
person.  The act of filing a claim for refund shall not be considered
as causing the erroneous refund.
   (b) This section shall be operative for any action for recovery
under Section 8171 on or after January 1, 2000.
  SEC. 3.  Section 8262 of the Revenue and Taxation Code is amended
to read:
   8262.  (a) The board shall develop and implement an education and
information program directed at, but not limited to, all of the
following groups:
   (1) Taxpayers newly registered with the board.
   (2) Board audit and compliance staff.
   (b) The education and information program shall include all of the
following:
   (1) A program of written communication with newly registered
taxpayers explaining in simplified terms their duties and
responsibilities.
   (2) Participation in seminars and similar programs organized by
federal, state, and local agencies.
   (3) Revision of taxpayer educational materials currently produced
by the board that explain the most common areas of taxpayer
nonconformance in simplified terms.
   (4) Implementation of a continuing education program for audit and
compliance personnel to include the application of new legislation
to taxpayer activities and areas of recurrent taxpayer noncompliance
or inconsistency of administration.
   (c) Electronic media used pursuant to this section shall not
represent the voice, picture, or name of members of the board or of
the Controller.
  SEC. 4.  Section 8269 of the Revenue and Taxation Code is amended
to read:
   8269.  (a) Every taxpayer is entitled to be reimbursed for any
reasonable fees and expenses related to a hearing before the board if
all of the following conditions are met:
   (1) The taxpayer files a claim for the fee and expenses with the
board within one year of the date the decision of the board becomes
final.
   (2) The board, in its sole discretion, finds that the action taken
by the board staff was unreasonable.
   (3) The board decides that the taxpayer be awarded a specific
amount of fees and expenses related to the hearing, in an amount
determined by the board in its sole discretion.
   (b) To determine whether the board staff has been unreasonable,
the board shall consider whether the board staff has established that
its position was substantially justified.
   (c) The amount of reimbursed fees and expenses shall be limited to
the following:
   (1) Fees and expenses incurred after the date of filing petitions
for redetermination and claims for refund.
   (2) If the board finds that the staff was unreasonable with
respect to certain issues but reasonable with respect to other
issues, the amount of reimbursed fees and expenses shall be limited
to those that relate to the issues where the staff was unreasonable.

   (d) Any proposed award by the board pursuant to subdivision (a)
shall be available as a public record for at least 10 days prior to
the effective date of the award.
   (e) The amendments to this section by the act adding this
subdivision shall be operative for claims filed on or after January
1, 2000.
  SEC. 5.  Section 8878.5 is added to the Revenue and Taxation Code,
to read:
   8878.5.  (a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by Sections 8803 and 8876
where the failure to pay tax is due in whole or in part to an
unreasonable error or delay by an employee of the board acting in his
or her official capacity.
   (b) For purposes of this section, an error or delay shall be
deemed to have occurred only if no significant aspect of the error or
delay is attributable to an act of, or a failure to act by, the
taxpayer.
   (c) Any person seeking relief under this section shall file with
the board a statement under penalty of perjury setting forth the
facts on which the claim for relief is based and any other
information which the board may require.
   (d) The board may grant relief only for interest imposed on tax
liabilities that arise during taxable periods commencing on or after
January 1, 2000.
  SEC. 6.  Section 9033 is added to the Revenue and Taxation Code, to
read:
   9033.  (a) The board may, in its discretion, enter into a written
installment payment agreement with a person for the payment of any
taxes due, together with interest thereon and any applicable
penalties, in installments over an agreed period.  With mutual
consent, the board and the taxpayer may alter or modify the
agreement.
   (b) Upon failure of a person to fully comply with the terms of an
installment payment agreement with the board, the board may terminate
the agreement by mailing a notice of termination to the person.  The
notice shall include an explanation of the basis for the termination
and inform the person of his or her right to request an
administrative review of the termination.  Fifteen days after the
mailing of the notice, the installment payment agreement shall be
void, and the total amount of the tax, interest, and penalties due
shall be immediately payable.
   (c) The board shall establish procedures for an administrative
review for persons requesting that review whose installment payment
agreements are terminated under subdivision (b).  The collection of
taxes, interest, and penalties that are the subject of the terminated
installment payment agreement may not be stayed during this
administrative review process.
   (d) Subdivision (b) shall not apply to any case where the board
finds collection of the tax to be in jeopardy.
  SEC. 7.  Section 9184 is added to the Revenue and Taxation Code, to
read:
   9184.  (a) Notwithstanding any other provision of this part, if
the board finds that neither the person liable for payment of tax nor
any party related to that person has in any way caused an erroneous
refund for which an action for recovery is provided under Section
9181, no interest shall be imposed on the amount of that erroneous
refund until 30 days after the date on which the board mails a notice
of determination for repayment of the erroneous refund to the
person.  The act of filing a claim for refund shall not be considered
as causing the erroneous refund.
   (b) This section shall be operative for any action for recovery
under Section 9181 on or after January 1, 2000.
  SEC. 8.  Section 9262 of the Revenue and Taxation Code is amended
to read:
   9262.  (a) The board shall develop and implement an education and
information program directed at, but not limited to, all of the
following groups:
   (1) Taxpayers newly registered with the board.
   (2) Board audit and compliance staff.
   (b) The education and information program shall include all of the
following:
   (1) A program of written communication with newly registered
taxpayers explaining in simplified terms their duties and
responsibilities.
   (2) Participation in seminars and similar programs organized by
federal, state, and local agencies.
   (3) Revision of taxpayer educational materials currently produced
by the board that explain the most common areas of taxpayer
nonconformance in simplified terms.
   (4) Implementation of a continuing education program for audit and
compliance personnel to include the application of new legislation
to taxpayer activities and areas of recurrent taxpayer noncompliance
or inconsistency of administration.
   (c) Electronic media used pursuant to this section shall not
represent the voice, picture, or name of members of the board or of
the Controller.
  SEC. 9.  Section 9269 of the Revenue and Taxation Code is amended
to read:
   9269.  (a) Every taxpayer is entitled to be reimbursed for any
reasonable fees and expenses related to a hearing before the board if
all of the following conditions are met:
   (1) The taxpayer files a claim for the fee and expenses with the
board within one year of the date the decision of the board becomes
final.
   (2) The board, in its sole discretion, finds that the action taken
by the board staff was unreasonable.
   (3) The board decides that the taxpayer be awarded a specific
amount of fees and expenses related to the hearing, in an amount
determined by the board in its sole discretion.
   (b) To determine whether the board staff has been unreasonable,
the board shall consider whether the board staff has established that
its position was substantially justified.
   (c) The amount of reimbursed fees and expenses shall be limited to
the following:
   (1) Fees and expenses incurred after the date of filing petitions
for redetermination and claims for refund.
   (2) If the board finds that the staff was unreasonable with
respect to certain issues but reasonable with respect to other
issues, the amount of reimbursed fees and expenses shall be limited
to those that relate to the issues where the staff was unreasonable.

   (d) Any proposed award by the board pursuant to subdivision (a)
shall be available as a public record for at least 10 days prior to
the effective date of the award.
   (e) The amendments to this section by the act adding this
subdivision shall be operative for claims filed on or after January
1, 2000.
  SEC. 10.  Section 9272.1 is added to the Revenue and Taxation Code,
to read:
   9272.1.  (a) Except in any case where the board finds collection
of the tax to be in jeopardy, if any property has been levied upon,
the property or the proceeds from the sale of the property shall be
returned to the taxpayer if the board determines any one of the
following:
   (1) The levy on the property was not in accordance with the law.
   (2) The taxpayer has entered into and is in compliance with an
installment payment agreement pursuant to Section 9033 to satisfy the
tax liability for which the levy was imposed, unless that or another
agreement allows for the levy.
   (3) The return of the property will facilitate the collection of
the tax liability or will be in the best interest of the state and
the taxpayer.
   (b) Property returned under paragraphs (1) and (2) of subdivision
(a) is subject to the provisions of Section 9274.
  SEC. 11.  Section 9275 of the Revenue and Taxation Code is amended
to read:
   9275.  (a) At least 30 days prior to the filing or recording of
liens under Chapter 14 (commencing with Section 7150) or Chapter 14.5
(commencing with Section 7220) of Division 7 of Title 1 of the
Government Code, the board shall mail to the taxpayer a preliminary
notice.  The notice shall specify the statutory authority of the
board for filing or recording the lien, indicate the earliest date on
which the lien may be filed or recorded, and state the remedies
available to the taxpayer to prevent the filing or recording of the
lien.  In the event tax liens are filed for the same liability in
multiple counties, only one preliminary notice shall be sent.
   (b) The preliminary notice required by this section shall not
apply to jeopardy determinations issued under Article 4 (commencing
with Section 8826) of Chapter 4.
   (c) If the board determines that filing a lien was in error, it
shall mail a release to the taxpayer and the entity recording the
lien as soon as possible, but no later than seven days, after this
determination and receipt of lien recording information.  The release
shall contain a statement that the lien was filed in error.  In the
event the erroneous lien is obstructing a lawful transaction, the
board shall immediately issue a release of lien to the taxpayer and
the entity recording the lien.
   (d) When the board releases a lien erroneously filed, notice of
that fact shall be mailed to the taxpayer and, upon the request of
the taxpayer, a copy of the release shall be mailed to the major
credit reporting companies in the county where the lien was filed.
   (e) The board may release or subordinate a lien if the board
determines that the release or subordination will facilitate the
collection of the tax liability or will be in the best interest of
the state and the taxpayer.
  SEC. 12.  Section 11253 is added to the Revenue and Taxation Code,
to read:
   11253.  (a) The board may, in its discretion, enter into a written
installment payment agreement with a person for the payment of any
taxes due, together with interest thereon and any applicable
penalties, in installments over an agreed period.  With mutual
consent, the board and the taxpayer may alter or modify the
agreement.
   (b) Upon failure of a person to fully comply with the terms of an
installment payment agreement with the board, the board may terminate
the agreement by mailing a notice of termination to the person.  The
notice shall include an explanation of the basis for the termination
and inform the person of his or her right to request an
administrative review of the termination.  Fifteen days after the
mailing of the notice, the installment payment agreement shall be
void, and the total amount of the tax, interest, and penalties due
shall be immediately payable.
   (c) The board shall establish procedures for an administrative
review for persons requesting that review whose installment payment
agreements are terminated under subdivision (b).  The collection of
taxes, interest, and penalties that are the subject of the terminated
installment payment agreement may not be stayed during this
administrative review process.
   (d) Subdivision (b) shall not apply to any case where the board
finds collection of the tax to be in jeopardy.
  SEC. 13.  Section 11254 is added to the Revenue and Taxation Code,
to read:
   11254.  Except in any case where the board finds collection of the
tax to be in jeopardy, if any property has been levied upon, the
property or the proceeds from the sale of the property shall be
returned to the taxpayer if the board determines any one of the
following:
   (a) The levy on the property was not in accordance with the law.
   (b) The taxpayer has entered into and is in compliance with an
installment payment agreement pursuant to Section 11253 to satisfy
the tax liability for which the levy was imposed, unless that or
another agreement allows for the levy.
   (c) The return of the property will facilitate the collection of
the tax liability or will be in the best interest of the state and
the taxpayer.
  SEC. 14.  Section 11409 is added to the Revenue and Taxation Code,
to read:
   11409.  (a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by Section 11319 where the
failure to pay tax is due in whole or in part to an unreasonable
error or delay by an employee of the board acting in his or her
official capacity.
   (b) For purposes of this section, an error or delay shall be
deemed to have occurred only if the person filed a timely report and
no significant aspect of the error or delay is attributable to an act
of, or a failure to act by, the taxpayer.
   (c) Any person seeking relief under this section shall file with
the board a statement under penalty of perjury setting forth the
facts on which the claim for relief is based and any other
information which the board may require.
   (d) The board may grant relief only for interest imposed on tax
liabilities that arise during taxable periods commencing on or after
January 1, 2000.
  SEC. 15.  Section 30283.5 is added to the Revenue and Taxation
Code, to read:
   30283.5.  (a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by Sections 30171, 30223,
and 30281 where the failure to pay tax is due in whole or in part to
an unreasonable error or delay by an employee of the board acting in
his or her official capacity.
   (b) For purposes of this section, an error or delay shall be
deemed to have occurred only if no significant aspect of the error or
delay is attributable to an act of, or a failure to act by, the
taxpayer.
   (c) Any person seeking relief under this section shall file with
the board a statement under penalty of perjury setting forth the
facts on which the claim for relief is based and any other
information which the board may require.
   (d) The board may grant relief only for interest imposed on tax
liabilities that arise during taxable periods commencing on or after
January 1, 2000.
  SEC. 16.  Section 30354 is added to the Revenue and Taxation Code,
to read:
   30354.  (a) The board may, in its discretion, enter into a written
installment payment agreement with a person for the payment of any
taxes due, together with interest thereon and any applicable
penalties, in installments over an agreed period.  With mutual
consent, the board and the taxpayer may alter or modify the
agreement.
   (b) Upon failure of a person to fully comply with the terms of an
installment payment agreement with the board, the board may terminate
the agreement by mailing a notice of termination to the person.  The
notice shall include an explanation of the basis for the termination
and inform the person of his or her right to request an
administrative review of the termination.  Fifteen days after the
mailing of the notice, the installment payment agreement shall be
void, and the total amount of the tax, interest, and penalties due
shall be immediately payable.
   (c) The board shall establish procedures for an administrative
review for persons requesting that review whose installment payment
agreements are terminated under subdivision (b).  The collection of
taxes, interest, and penalties that are the subject of the terminated
installment payment agreement may not be stayed during this
administrative review process.
   (d) Subdivision (b) shall not apply to any case where the board
finds collection of the tax to be in jeopardy.
  SEC. 17.  Section 30384 is added to the Revenue and Taxation Code,
to read:
   30384.  (a) Notwithstanding any other provision of this part, if
the board finds that neither the person liable for payment of tax nor
any party related to that person has in any way caused an erroneous
refund for which an action for recovery is provided under Section
30381, no interest shall be imposed on the amount of that erroneous
refund until 30 days after the date on which the board mails a notice
of determination for repayment of the erroneous refund to the
person.  The act of filing a claim for refund shall not be considered
as causing the erroneous refund.
   (b) This section shall be operative for any action for recovery
under Section 30381 on or after January 1, 2000.
  SEC. 18.  Section 30458.2 of the Revenue and Taxation Code is
amended to read:
   30458.2.  (a) The board shall develop and implement an education
and information program directed at, but not limited to, all of the
following groups:
   (1) Taxpayers newly registered with the board.
   (2) Board audit and compliance staff.
   (b) The education and information program shall include all of the
following:
   (1) A program of written communication with newly registered
taxpayers explaining in simplified terms their duties and
responsibilities.
   (2) Participation in seminars and similar programs organized by
federal, state, and local agencies.
   (3) Revision of taxpayer educational materials currently produced
by the board that explain the most common areas of taxpayer
nonconformance in simplified terms.
   (4) Implementation of a continuing education program for audit and
compliance personnel to include the application of new legislation
to taxpayer activities and areas of recurrent taxpayer noncompliance
or inconsistency of administration.
   (c) Electronic media used pursuant to this section shall not
represent the voice, picture, or name of members of the board or of
the Controller.
  SEC. 19.  Section 30458.9 of the Revenue and Taxation Code is
amended to read:
   30458.9.  (a) Every taxpayer is entitled to be reimbursed for any
reasonable fees and expenses related to a hearing before the board if
all of the following conditions are met:
   (1) The taxpayer files a claim for the fees and expenses with the
board within one year of the date the decision of the board becomes
final.
   (2) The board, in its sole discretion, finds that the action taken
by the board staff was unreasonable.
   (3) The board decides that the taxpayer be awarded a specific
amount of fees and expenses related to the hearing, in an amount
determined by the board in its sole discretion.
   (b) To determine whether the board staff has been unreasonable,
the board shall consider whether the board staff has established that
its position was substantially justified.
   (c) The amount of reimbursed fees and expenses shall be limited to
the following:
   (1) Fees and expenses incurred after the date of filing petitions
for redetermination and claims for refund.
   (2) If the board finds that the staff was unreasonable with
respect to certain issues but reasonable with respect to other
issues, the amount of reimbursed fees and expenses shall be limited
to those that relate to the issues where the state was unreasonable.

   (d) Any proposed award by the board pursuant to subdivision (a)
shall be available as a public record for at least 10 days prior to
the effective date of the award.
   (e) The amendments to this section by the act adding this
subdivision shall be operative for claims filed on or after January
1, 2000.
  SEC. 20.  Section 30459.2A is added to the Revenue and Taxation
Code, to read:
   30459.2A.  (a) Except in any case where the board finds collection
of the tax to be in jeopardy, if any property has been levied upon,
the property or the proceeds from the sale of the property shall be
returned to the taxpayer if the board determines any one of the
following:
   (1) The levy on the property was not in accordance with the law.
   (2) The taxpayer has entered into and is in compliance with an
installment payment agreement pursuant to Section 30354 to satisfy
the tax liability for which the levy was imposed, unless that or
another agreement allows for the levy.
   (3) The return of the property will facilitate the collection of
the tax liability or will be in the best interest of the state and
the taxpayer.
   (b) Property returned under paragraphs (1) and (2) of subdivision
(a) shall be subject to the provisions of Section 30459.4.
  SEC. 21.  Section 30459.5 of the Revenue and Taxation Code is
amended to read:
   30459.5.  (a) At least 30 days prior to the filing or recording of
liens under Chapter 14 (commencing with Section 7150) or Chapter
14.5 (commencing with Section 7220) of Division 7 of Title 1 of the
Government Code, the board shall mail to the taxpayer a preliminary
notice.  The notice shall specify the statutory authority of the
board for filing                                                  or
recording the lien, indicate the earliest date on which the lien may
be filed or recorded, and state the remedies available to the
taxpayer to prevent the filing or recording of the lien.  In the
event tax liens are filed for the same liability in multiple
counties, only one preliminary notice shall be sent.
   (b) The preliminary notice required by this section shall not
apply to jeopardy determinations issued under Article 4 (commencing
with Section 30241) of Chapter 4.
   (c) If the board determines that filing a lien was in error, it
shall mail a release to the taxpayer and the entity recording the
lien as soon as possible, but no later than seven days, after this
determination and receipt of lien recording information.  The release
shall contain a statement that the lien was filed in error.  In the
event the erroneous lien is obstructing a lawful transaction, the
board shall immediately issue a release of lien to the taxpayer and
the entity recording the lien.
   (d) When the board releases a lien erroneously filed, notice of
that fact shall be mailed to the taxpayer and, upon the request of
the taxpayer, a copy of the release shall be mailed to the major
credit reporting companies in the county where the lien was filed.
   (e) The board may release or subordinate a lien if the board
determines that the release or subordination will facilitate the
collection of the tax liability or will be in the best interest of
the state and the taxpayer.
  SEC. 22.  Section 32256.5 is added to the Revenue and Taxation
Code, to read:
   32256.5.  (a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by Sections 32254 and 32291
where the failure to pay tax is due in whole or in part to an
unreasonable error or delay by an employee of the board acting in his
or her official capacity.
   (b) For purposes of this section, an error or delay shall be
deemed to have occurred only if no significant aspect of the error or
delay is attributable to an act of, or a failure to act by, the
taxpayer.
   (c) Any person seeking relief under this section shall file with
the board a statement under penalty of perjury setting forth the
facts on which the claim for relief is based and any other
information which the board may require.
   (d) The board may grant relief only for interest imposed on tax
liabilities that arise during taxable periods commencing on or after
January 1, 2000.
  SEC. 23.  Section 32389 is added to the Revenue and Taxation Code,
to read:
   32389.  (a) The board may, in its discretion, enter into a written
installment payment agreement with a person for the payment of any
taxes due, together with interest thereon and any applicable
penalties, in installments over an agreed period.  With mutual
consent, the board and the taxpayer may alter or modify the
agreement.
   (b) Upon failure of a person to fully comply with the terms of an
installment payment agreement with the board, the board may terminate
the agreement by mailing a notice of termination to the person.  The
notice shall include an explanation of the basis for the termination
and inform the person of his or her right to request an
administrative review of the termination.  Fifteen days after the
mailing of the notice, the installment payment agreement shall be
void, and the total amount of the tax, interest, and penalties due
shall be immediately payable.
   (c) The board shall establish procedures for an administrative
review for persons requesting that review whose installment payment
agreements are terminated under subdivision (b).  The collection of
taxes, interest, and penalties that are the subject of the terminated
installment payment agreement may not be stayed during this
administrative review process.
   (d) Subdivision (b) shall not apply to any case where the board
finds collection of the tax to be in jeopardy.
  SEC. 24.  Section 32432 is added to the Revenue and Taxation Code,
to read:
   32432.  (a) Notwithstanding any other provision of this part, if
the board finds that neither the person liable for payment of tax nor
any party related to that person has in any way caused an erroneous
refund for which an action for recovery is provided under Section
32431, no interest shall be imposed on the amount of that erroneous
refund until 30 days after the date on which the board mails a notice
of determination for repayment of the erroneous refund to the
person.  The act of filing a claim for refund shall not be considered
as causing the erroneous refund.
   (b) This section shall be operative for any action for recovery
under Section 32431 on or after January 1, 2000.
  SEC. 25.  Section 32462 of the Revenue and Taxation Code is amended
to read:
   32462.  (a) The board shall develop and implement an education and
information program directed at, but not limited to, all of the
following groups:
   (1) Taxpayers newly registered with the board.
   (2) Board audit and compliance staff.
   (b) The education and information program shall include all of the
following:
   (1) A program of written communication with newly registered
taxpayers explaining in simplified terms their duties and
responsibilities.
   (2) Participation in seminars and similar programs organized by
federal, state, and local agencies.
   (3) Revision of taxpayer educational materials currently produced
by the board that explain the most common areas of taxpayer
nonconformance in simplified terms.
   (4) Implementation of a continuing education program for audit and
compliance personnel to include the application of new legislation
to taxpayer activities and areas of recurrent taxpayer noncompliance
or inconsistency of administration.
   (c) Electronic media used pursuant to this section shall not
represent the voice, picture, or name of members of the board or of
the Controller.
  SEC. 26.  Section 32469 of the Revenue and Taxation Code is amended
to read:
   32469.  (a) Every taxpayer is entitled to be reimbursed for any
reasonable fees and expenses related to a hearing before the board if
all of the following conditions are met:
   (1) The taxpayer files a claim for the fee and expenses with the
board within one year of the date the decision of the board becomes
final.
   (2) The board, in its sole discretion, finds that the action taken
by the board staff was unreasonable.
   (3) The board decides that the taxpayer be awarded a specific
amount of fees and expenses related to the hearing, in an amount
determined by the board in its sole discretion.
   (b) To determine whether the board staff has been unreasonable,
the board shall consider whether the board staff has established that
its position was substantially justified.
   (c) The amount of reimbursed fees and expenses shall be limited to
the following:
   (1) Fees and expenses incurred after the date of filing petitions
for redetermination and claims for refund.
   (2) If the board finds that the staff was unreasonable with
respect to certain issues but reasonable with respect to other
issues, the amount of reimbursed fees and expenses shall be limited
to those that relate to the issues where the staff was unreasonable.

   (d) Any proposed award by the board pursuant to subdivision (a)
shall be available as a public record for at least 10 days prior to
the effective date of the award.
   (e) The amendments to this section by the act adding this
subdivision shall be operative for claims filed on or after January
1, 2000.
  SEC. 27.  Section 32472.1 is added to the Revenue and Taxation
Code, to read:
   32472.1.  (a) Except in any case where the board finds collection
of the tax to be in jeopardy, if any property has been levied upon,
the property or the proceeds from the sale of the property shall be
returned to the taxpayer if the board determines any one of the
following:
   (1) The levy on the property was not in accordance with the law.
   (2) The taxpayer has entered into and is in compliance with an
installment payment agreement pursuant to Section 32389 to satisfy
the tax liability for which the levy was imposed, unless that or
another agreement allows for the levy.
   (3) The return of the property will facilitate the collection of
the tax liability or will be in the best interest of the state and
the taxpayer.
   (b) Property returned under paragraphs (1) and (2) of subdivision
(a) is subject to the provisions of Section 32474.
  SEC. 28.  Section 32475 of the Revenue and Taxation Code is amended
to read:
   32475.  (a) At least 30 days prior to the filing or recording of
liens under Chapter 14 (commencing with Section 7150) or Chapter 14.5
(commencing with Section 7220) of Division 7 of Title 1 of the
Government Code, the board shall mail to the taxpayer a preliminary
notice.  The notice shall specify the statutory authority of the
board for filing or recording the lien, indicate the earliest date on
which the lien may be filed or recorded, and state the remedies
available to the taxpayer to prevent the filing or recording of the
lien.  In the event tax liens are filed for the same liability in
multiple counties, only one preliminary notice shall be sent.
   (b) The preliminary notice required by this section shall not
apply to jeopardy determinations issued under Article 5 (commencing
with Section 32311) of Chapter 6.
   (c) If the board determines that filing a lien was in error, it
shall mail a release to the taxpayer and the entity recording the
lien as soon possible, but no later than seven days, after this
determination and receipt of lien recording information.  The release
shall contain a statement that the lien was filed in error.  In the
event the erroneous lien is obstructing a lawful transaction, the
board shall immediately issue a release of lien to the taxpayer and
the entity recording the lien.
   (d) When the board releases a lien erroneously filed, notice of
that fact shall be mailed to the taxpayer and, upon the request of
the taxpayer, a copy of the release shall be mailed to the major
credit reporting companies in the county where the lien was filed.
   (e) The board may release or subordinate a lien if the board
determines that the release or subordination will facilitate the
collection of the tax liability or will be in the best interest of
the state and the taxpayer.
  SEC. 29.  Section 38455 is added to the Revenue and Taxation Code,
to read:
   38455.  (a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by Sections 38412, 38423,
38432, and 38451 where the failure to pay tax is due in whole or in
part to an unreasonable error or delay by an employee of the board
acting in his or her official capacity.
   (b) For purposes of this section, an error or delay shall be
deemed to have occurred only if the person filed a timely report and
no significant aspect of the error or delay is attributable to an act
of, or a failure to act by, the taxpayer.
   (c) Any person seeking relief under this section shall file with
the board a statement under penalty of perjury setting forth the
facts on which the claim for relief is based and any other
information which the board may require.
   (d) The board may grant relief only for interest imposed on tax
liabilities that arise during taxable periods commencing on or after
January 1, 2000.
  SEC. 30.  Section 38504 is added to the Revenue and Taxation Code,
to read:
   38504.  (a) The board may, in its discretion, enter into a written
installment payment agreement with a person for the payment of any
taxes due, together with interest thereon and any applicable
penalties, in installments over an agreed period.  With mutual
consent, the board and the taxpayer may alter or modify the
agreement.
   (b) Upon failure of a person to fully comply with the terms of an
installment payment agreement with the board, the board may terminate
the agreement by mailing a notice of termination to the person.  The
notice shall include an explanation of the basis for the termination
and inform the person of his or her right to request an
administrative review of the termination.  Fifteen days after the
mailing of the notice, the installment payment agreement shall be
void, and the total amount of the tax, interest, and penalties due
shall be immediately payable.
   (c) The board shall establish procedures for an administrative
review for persons requesting that review whose installment payment
agreements are terminated under subdivision (b).  The collection of
taxes, interest, and penalties that are the subject of the terminated
installment payment agreement may not be stayed during this
administrative review process.
   (d) Subdivision (b) shall not apply to any case where the board
finds collection of the tax to be in jeopardy.
  SEC. 31.  Section 38505 is added to the Revenue and Taxation Code,
to read:
   38505.  Except in any case where the board finds collection of the
tax to be in jeopardy, if any property has been levied upon, the
property or the proceeds from the sale of the property shall be
returned to the taxpayer if the board determines any one of the
following:
   (a) The levy on the property was not in accordance with the law.
   (b) The taxpayer has entered into and is in compliance with an
installment payment agreement pursuant to Section 38504 to satisfy
the tax liability for which the levy was imposed, unless that or
another agreement allows for the levy.
   (c) The return of the property will facilitate the collection of
the tax liability or will be in the best interest of the state and
the taxpayer.
  SEC. 32.  Section 38621 of the Revenue and Taxation Code is amended
to read:
   38621.  (a) The Controller may recover any refund or part thereof
that is erroneously made and any credit or part thereof that is
erroneously allowed in an action brought in a court of competent
jurisdiction in the County of Sacramento in the name of the people of
the State of California.
   (b) As an alternative to subdivision (a), the board may recover
any refund or part thereof that is erroneously made and any credit or
part thereof that is erroneously allowed pursuant to this part.  In
recovering any erroneous refunds or credits, the board, in its
discretion, may issue a deficiency determination in accordance with
Article 2 (commencing with Section 38411) or Article 4 (commencing
with Section 38431) of Chapter 5.  Except in the case of fraud, the
determination shall be made within three years from the date of the
Controller's warrant or date of credit.
  SEC. 32.5.  Section 38624 is added to the Revenue and Taxation
Code, to read:
   38624.  (a) Notwithstanding any other provision of this part, if
the board finds that neither the person liable for payment of tax nor
any party related to that person has in any way caused an erroneous
refund for which an action for recovery is provided under Section
38621, no interest shall be imposed on the amount of that erroneous
refund until 30 days after the date on which the board mails a notice
of determination for repayment of the erroneous refund to the
person.  The act of filing a claim for refund shall not be considered
as causing the erroneous refund.
   (b) This section shall be operative for any action for recovery
under Section 38621 on or after January 1, 2000.
  SEC. 33.  Section 40103.5 is added to the Revenue and Taxation
Code, to read:
   40103.5.  (a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by Sections 40083 and 40101
where the failure to pay the surcharge is due in whole or in part to
an unreasonable error or delay by an employee of the board acting in
his or her official capacity.
   (b) For purposes of this section, an error or delay shall be
deemed to have occurred only if no significant aspect of the error or
delay is attributable to an act of, or a failure to act by, the
person liable for the surcharge.
   (c) Any person seeking relief under this section shall file with
the board a statement under penalty of perjury setting forth the
facts on which the claim for relief is based and any other
information which the board may require.
   (d) The board may grant relief only for interest imposed on
surcharge liabilities that arise during taxable periods commencing on
or after January 1, 2000.
  SEC. 34.  Section 40167 is added to the Revenue and Taxation Code,
to read:
   40167.  (a) The board may, in its discretion, enter into a written
installment payment agreement with a person for the payment of any
surcharges due, together with interest thereon and any applicable
penalties, in installments over an agreed period.  With mutual
consent, the board and the person liable for the surcharge may alter
or modify the agreement.
   (b) Upon failure of a person to fully comply with the terms of an
installment payment agreement with the board, the board may terminate
the agreement by mailing a notice of termination to the person.  The
notice shall include an explanation of the basis for the termination
and inform the person of his or her right to request an
administrative review of the termination.  Fifteen days after the
mailing of the notice, the installment payment agreement shall be
void, and the total amount of the surcharge, interest, and penalties
due shall be immediately payable.
   (c) The board shall establish procedures for an administrative
review for persons requesting that review whose installment payment
agreements are terminated under subdivision (b).  The collection of
surcharge, interest, and penalties that are the subject of the
terminated installment payment agreement may not be stayed during
this administrative review process.
  SEC. 35.  Section 40202 of the Revenue and Taxation Code is amended
to read:
   40202.  (a) The board shall develop and implement an education and
information program directed at, but not limited to, all of the
following groups:
   (1) Taxpayers newly registered with the board.
   (2) Board audit and compliance staff.
   (b) The education and information program shall include all of the
following:
   (1) A program of written communication with newly registered
taxpayers explaining in simplified terms their duties and
responsibilities.
   (2) Participation in seminars and similar programs organized by
federal, state, and local agencies.
   (3) Revision of taxpayer education materials currently produced by
the board that explain the most common areas of taxpayer
nonconformance in simplified terms.
   (4) Implementation of a continuing education program for audit and
compliance personnel to include the application of new legislation
to taxpayer activities and areas of recurrent taxpayer noncompliance
or inconsistency of administration.
   (c) Electronic media used pursuant to this section shall not
represent the voice, picture, or name of members of the board or of
the Controller.
  SEC. 36.  Section 40209 of the Revenue and Taxation Code is amended
to read:
   40209.  (a) Every taxpayer is entitled to be reimbursed for any
reasonable fees and expenses related to a hearing before the board if
all of the following conditions are met:
   (1) The taxpayer files a claim for the fee and expenses with the
board within one year of the date the decision of the board becomes
final.
   (2) The board, in its sole discretion, finds that the action taken
by the board staff was unreasonable.
   (3) The board decides that the taxpayer be awarded a specific
amount of fees and expenses related to the hearing, in an amount
determined by the board in its sole discretion.
   (b) To determine whether the board staff has been unreasonable,
the board shall consider whether the board staff has established that
its position was substantially justified.
   (c) The amount of reimbursed fees and expenses shall be limited to
the following:
   (1) Fees and expenses incurred after the date of filing petitions
for redetermination and claims for refund.
   (2) If the board finds that the staff was unreasonable with
respect to certain issues but reasonable with respect to other
issues, the amount of reimbursed fees and expenses shall be limited
to those that relate to the issues where the staff was unreasonable.

   (d) Any proposed award by the board pursuant to subdivision (a)
shall be available as a public record for at least 10 days prior to
the effective date of the award.
   (e) The amendments to this section by the act adding this
subdivision shall be operative for claims filed on or after January
1, 2000.
  SEC. 37.  Section 40212.5 is added to the Revenue and Taxation
Code, to read:
   40212.5.  (a) Except in any case where the board finds collection
of the tax to be in jeopardy, if any property has been levied upon,
the property or the proceeds from the sale of the property shall be
returned to the taxpayer if the board determines any one of the
following:
   (1) The levy on the property was not in accordance with the law.
   (2) The taxpayer has entered into and is in compliance with an
installment payment agreement pursuant to Section 40167 to satisfy
the tax liability for which the levy was imposed, unless that or
another agreement allows for the levy.
   (3) The return of the property will facilitate the collection of
the tax liability or will be in the best interest of the state and
the taxpayer.
   (b) Property returned under paragraphs (1) and (2) of subdivision
(a) is subject to the provisions of Section 40214.
  SEC. 38.  Section 40215 of the Revenue and Taxation Code is amended
to read:
   40215.  (a) At least 30 days prior to the filing or recording of
liens under Chapter 14 (commencing with Section 7150) or Chapter 14.5
(commencing with Section 7220) of Division 7 of Title 1 of the
Government Code, the board shall mail to the taxpayer a preliminary
notice.  The notice shall specify the statutory authority of the
board for filing or recording the lien, indicate the earliest date on
which the lien may be filed or recorded, and state the remedies
available to the taxpayer to prevent the filing or recording of the
lien.  In the event tax liens are filed for the same liability in
multiple counties, only one preliminary notice shall be sent.
   (b) If the board determines that filing a lien was in error, it
shall mail a release to the taxpayer and the entity recording the
lien as soon as possible, but no later than seven days, after this
determination and receipt of lien recording information.  The release
shall contain a statement that the lien was filed in error.  In the
event the erroneous lien is obstructing a lawful transaction, the
board shall immediately issue a release of lien to the taxpayer and
the entity recording the lien.
   (c) When the board releases a lien erroneously filed, notice of
that fact shall be mailed to the taxpayer and, upon the request of
the taxpayer, a copy of the release shall be mailed to the major
credit reporting companies in the county where the lien was filed.
   (d) The board may release or subordinate a lien if the board
determines that the release or subordination will facilitate the
collection of the tax liability or will be in the best interest of
the state and the taxpayer.
  SEC. 39.  Section 41097.5 is added to the Revenue and Taxation
Code, to read:
   41097.5.  (a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by Sections 41082 and 41095
where the failure to pay tax is due in whole or in part to an
unreasonable error or delay by an employee of the board acting in his
or her official capacity.
   (b) For purposes of this section, an error or delay shall be
deemed to have occurred only if no significant aspect of the error or
delay is attributable to an act of, or a failure to act by, the
taxpayer.
   (c) Any person seeking relief under this section shall file with
the board a statement under penalty of perjury setting forth the
facts on which the claim for relief is based and any other
information which the board may require.
   (d) The board may grant relief only for interest imposed on tax
liabilities that arise during taxable periods commencing on or after
January 1, 2000.
  SEC. 40.  Section 41127.6 is added to the Revenue and Taxation
Code, to read:
   41127.6.  (a) The board may, in its discretion, enter into a
written installment payment agreement with a person for the payment
of any taxes due, together with interest thereon and any applicable
penalties, in installments over an agreed period.  With mutual
consent, the board and the taxpayer may alter or modify the
agreement.
   (b) Upon failure of a person to fully comply with the terms of an
installment payment agreement with the board, the board may terminate
the agreement by mailing a notice of termination to the person.  The
notice shall include an explanation of the basis for the termination
and inform the person of his or her right to request an
administrative review of the termination.  Fifteen days after the
mailing of the notice, the installment payment agreement shall be
void, and the total amount of the tax, interest, and penalties due
shall be immediately payable.
   (c) The board shall establish procedures for an administrative
review for persons requesting that review whose installment payment
agreements are terminated under subdivision (b).  The collection of
taxes, interest, and penalties that are the subject of the terminated
installment payment agreement may not be stayed during this
administrative review process.
   (d) Subdivision (b) shall not apply to any case where the board
finds collection of the tax to be in jeopardy.
  SEC. 41.  Section 41162 of the Revenue and Taxation Code is amended
to read:
   41162.  (a) The board shall develop and implement an education and
information program directed at, but not limited to, all of the
following groups:
   (1) Taxpayers newly registered with the board.
   (2) Board audit and compliance staff.
   (b) The education and information program shall include all of the
following:
   (1) A program of written communication with newly registered
taxpayers explaining in simplified terms their duties and
responsibilities.
   (2) Participation in seminars and similar programs organized by
federal, state, and local agencies.
   (3) Revision of taxpayer educational materials currently produced
by the board that explain the most common areas of taxpayer
nonconformance in simplified terms.
   (4) Implementation of a continuing education program for audit and
compliance personnel to include the application of new legislation
to taxpayer activities and areas of recurrent taxpayer noncompliance
or inconsistency of administration.

(c) Electronic media used pursuant to this section shall not
represent the voice, picture, or name of members of the board or the
Controller.
  SEC. 42.  Section 41169 of the Revenue and Taxation Code is amended
to read:
   41169.  (a) Every taxpayer is entitled to be reimbursed for any
reasonable fees and expenses related to a hearing before the board if
all of the following conditions are met:
   (1) The taxpayer files a claim for the fee and expenses with the
board within one year of the date the decision of the board becomes
final.
   (2) The board, in its sole discretion, finds that the action taken
by the board staff was unreasonable.
   (3) The board decides that the taxpayer be awarded a specific
amount of fees and expenses related to the hearing, in an amount
determined by the board in its sole discretion.
   (b) To determine whether the board staff has been unreasonable,
the board shall consider whether the board staff has established that
its position was substantially justified.
   (c) The amount of reimbursed fees and expenses shall be limited to
the following:
   (1) Fees and expenses incurred after the date of filing petitions
for redetermination and claims for refund.
   (2) If the board finds that the staff was unreasonable with
respect to certain issues but reasonable with respect to other
issues, the amount of reimbursed fees and expenses shall be limited
to those that relate to the issues where the staff was unreasonable.

   (d) Any proposed award by the board pursuant to subdivision (a)
shall be available as a public record for at least 10 days prior to
the effective date of the award.
   (e) The amendments to this section by the act adding this
subdivision shall be operative for claims filed on or after January
1, 2000.
  SEC. 43.  Section 41172.5 is added to the Revenue and Taxation
Code, to read:
   41172.5.  (a) If any property has been levied upon, the property
or the proceeds from the sale of the property shall be returned to
the taxpayer if the board determines any one of the following:
   (1) The levy on the property was not in accordance with the law.
   (2) The taxpayer has entered into and is in compliance with an
installment payment agreement pursuant to Section 41127.5 to satisfy
the tax liability for which the levy was imposed, unless that or
another agreement allows for the levy.
   (3) The return of the property will facilitate the collection of
the tax liability or will be in the best interest of the state and
the taxpayer.
   (b) Property returned under paragraphs (1) and (2) of subdivision
(a) is subject to the provisions of Section 41174.
  SEC. 44.  Section 41175 of the Revenue and Taxation Code is amended
to read:
   41175.  (a) At least 30 days prior to the filing or recording of
liens under Chapter 14 (commencing with Section 7150) or Chapter 14.5
(commencing with Section 7220) of Division 7 of Title 1 of the
Government Code, the board shall mail to the taxpayer a preliminary
notice.  The notice shall specify the statutory authority of the
board for filing or recording the lien, indicate the earliest date on
which the lien may be filed or recorded, and state the remedies
available to the taxpayer to prevent the filing or recording of the
lien.  In the event tax liens are filed for the same liability in
multiple counties, only one preliminary notice shall be sent.
   (b) If the board determines that filing a lien was in error, it
shall mail a release to the taxpayer and the entity recording the
lien as soon as possible, but no later than seven days, after this
determination and receipt of lien recording information.  The release
shall contain a statement that the lien was filed in error.  In the
event the erroneous lien is obstructing a lawful transaction, the
board shall immediately issue a release of lien to the taxpayer and
the entity recording the lien.
   (c) When the board releases a lien erroneously filed, notice of
that fact shall be mailed to the taxpayer and, upon the request of
the taxpayer, a copy of the release shall be mailed to the major
credit reporting companies in the county where the lien was filed.
   (d) The board may release or subordinate a lien if the board
determines that the release or subordination will facilitate the
collection of the tax liability or will be in the best interest of
the state and the taxpayer.
  SEC. 45.  Section 43158.5 is added to the Revenue and Taxation
Code, to read:
   43158.5.  (a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by Section 43156 and may
relieve all or any part of the interest imposed on a person by
Section 43201 where the deficiency determination is made because no
return was filed or payment of the fee was not made timely, where the
failure to pay fees is due in whole or in part to an unreasonable
error or delay by an employee of the board acting in his or her
official capacity.
   (b) For purposes of this section, an error or delay shall be
deemed to have occurred only if no significant aspect of the error or
delay is attributable to an act of, or a failure to act by, the
taxpayer.
   (c) Any person seeking relief under this section shall file with
the board a statement under penalty of perjury setting forth the
facts on which the claim for relief is based and any other
information which the board may require.
   (d) The board may grant relief only for interest imposed on tax
liabilities that arise during taxable periods commencing on or after
January 1, 2000.
  SEC. 46.  Section 43448 is added to the Revenue and Taxation Code,
to read:
   43448.  (a) The board may, in its discretion, enter into a written
installment payment agreement with a person for the payment of any
taxes due, together with interest thereon and any applicable
penalties, in installments over an agreed period.  With mutual
consent, the board and the taxpayer may alter or modify the
agreement.
   (b) Upon failure of a person to fully comply with the terms of an
installment payment agreement with the board, the board may terminate
the agreement by mailing a notice of termination to the person.  The
notice shall include an explanation of the basis for the termination
and inform the person of his or her right to request an
administrative review of the termination.  Fifteen days after the
mailing of the notice, the installment payment agreement shall be
void, and the total amount of the tax, interest, and penalties due
shall be immediately payable.
   (c) The board shall establish procedures for an administrative
review for persons requesting that review whose installment payment
agreements are terminated under subdivision (b).  The collection of
taxes, interest, and penalties that are the subject of the terminated
installment payment agreement may not be stayed during this
administrative review process.
   (d) Subdivision (b) shall not apply to any case where the board
finds collection of the tax to be in jeopardy.
  SEC. 47.  Section 43484 is added to the Revenue and Taxation Code,
to read:
   43484.  (a) Notwithstanding any other provision of this part, if
the board finds that neither the person liable for payment of tax nor
any party related to that person has in any way caused an erroneous
refund for which an action for recovery is provided under Section
43481, no interest shall be imposed on the amount of that erroneous
refund until 30 days after the date on which the board mails a notice
of determination for repayment of the erroneous refund to the
person.  The act of filing a claim for refund shall not be considered
as causing the erroneous refund.
   (b) This section shall be operative for any action for recovery
under Section 43481 on or after January 1, 2000.
  SEC. 48.  Section 43513 of the Revenue and Taxation Code is amended
to read:
   43513.  (a) The board shall develop and implement an education and
information program directed at, but not limited to, all of the
following groups:
   (1) Taxpayers newly registered with the board.
   (2) Board audit and compliance staff.
   (b) The education and information program shall include all of the
following:
   (1) A program of written communication with newly registered
taxpayers explaining in simplified terms their duties and
responsibilities.
   (2) Participation in seminars and similar programs organized by
federal, state, and local agencies.
   (3) Revision of taxpayer educational materials currently produced
by the board that explain the most common areas of taxpayer
nonconformance in simplified terms.
   (4) Implementation of a continuing education program for audit and
compliance personnel to include the application of new legislation
to taxpayer activities and areas of recurrent taxpayer noncompliance
of inconsistency of administration.
   (c) Electronic media used pursuant to this section shall not
represent the voice, picture, or name of members of the board or of
the Controller.
  SEC. 49.  Section 43520 of the Revenue and Taxation Code is amended
to read:
   43520.  (a) Every taxpayer is entitled to be reimbursed for any
reasonable fees and expenses related to a hearing before the board if
all of the following conditions are met:
   (1) The taxpayer files a claim for the fees and expenses with the
board within one year of the date the decision of the board becomes
final.
   (2) The board, in its sole discretion, finds that the action taken
by the board staff was unreasonable.
   (3) The board decides that the taxpayer be awarded a specific
amount of fees and expenses related to the hearing, in an amount
determined by the board in its sole discretion.
   (b) To determine whether the board staff has been unreasonable,
the board shall consider whether the board staff has established that
its position was substantially justified.
   (c) The amount of reimbursed fees and expenses shall be limited to
the following:
   (1) Fees and expenses incurred after the date of filing petitions
for redetermination and claims for refund.
   (2) If the board finds that the staff was unreasonable with
respect to certain issues but reasonable with respect to other
issues, the amount of reimbursed fees and expenses shall be limited
to those that relate to the issues where the staff was unreasonable.

   (d) Any proposed award by the board pursuant to subdivision (a)
shall be available as a public record for at least 10 days prior to
the effective date of the award.
   (e) The amendments to this section by the act adding this
subdivision shall be operative for claims filed on or after January
1, 2000.
  SEC. 50.  Section 43523.5 is added to the Revenue and Taxation
Code, to read:
   43523.5.  (a) Except in any case where the board finds collection
of the tax to be in jeopardy, if any property has been levied upon,
the property or the proceeds from the sale of the property shall be
returned to the taxpayer if the board determines any one of the
following:
   (1) The levy on the property was not in accordance with the law.
   (2) The taxpayer has entered into and is in compliance with an
installment payment agreement pursuant to Section 43448 to satisfy
the tax liability for which the levy was imposed, unless that or
another agreement allows for the levy.
   (3) The return of the property will facilitate the collection of
the tax liability or will be in the best interest of the state and
the taxpayer.
   (b) Property returned under paragraphs (1) and (2) of subdivision
(a) is subject to the provisions of Section 43525.
  SEC. 51.  Section 43526 of the Revenue and Taxation Code is amended
to read:
   43526.  (a) At least 30 days prior to the filing or recording of
liens under Chapter 14 (commencing with Section 7150) or Chapter 14.5
(commencing with Section 7220) of Division 7 of Title 1 of the
Government Code, the board shall mail to the taxpayer a preliminary
notice.  The notice shall specify the statutory authority of the
board for filing or recording the lien, indicate the earliest date on
which the lien may be filed or recorded, and state the remedies
available to the taxpayer to prevent the filing or recording of the
lien.  In the event tax liens are filed for the same liability in
multiple counties, only one preliminary notice shall be sent.
   (b) The preliminary notice required by this section shall not
apply to jeopardy determinations issued under Article 5 (commencing
with Section 43350) of Chapter 3.
   (c) If the board determines that filing a lien was in error, it
shall mail a release to the taxpayer and the entity recording the
lien as soon as possible, but no later than seven days, after this
determination and receipt of lien recording information.  The release
shall contain a statement that the lien was filed in error.  In the
event the erroneous lien is obstructing a lawful transaction, the
board shall immediately issue a release of lien to the taxpayer and
the entity recording the lien.
   (d) When the board releases a lien erroneously filed, notice of
that fact shall be mailed to the taxpayer and, upon the request of
the taxpayer, a copy of the release shall be mailed to the major
credit reporting companies in the county where the lien was filed.
   (e) The board may release or subordinate a lien if the board
determines that the release or subordination will facilitate the
collection of the tax liability or will be in the best interest of
the state and the taxpayer.
  SEC. 52.  Section 45156.5 is added to the Revenue and Taxation
Code, to read:
   45156.5.  (a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by Section 45154 and may
relieve all or any part of the interest imposed on a person by
Section 45201 where the deficiency determination is made because no
return was filed or payment of the fee was not made timely, or where
the failure to pay fees is due in whole or in part to an unreasonable
error or delay by an employee of the board acting in his or her
official capacity.
   (b) For purposes of this section, an error or delay shall be
deemed to have occurred only if no significant aspect of the error or
delay is attributable to an act of, or a failure to act by, the fee
payer.
   (c) Any person seeking relief under this section shall file with
the board a statement under penalty of perjury setting forth the
facts on which the claim for relief is based and any other
information which the board may require.
   (d) The board may grant relief only for interest imposed on fee
liabilities that arise during taxable periods commencing on or after
January 1, 2000.
  SEC. 53.  Section 45609 is added to the Revenue and Taxation Code,
to read:
   45609.  (a) The board may, in its discretion, enter into a written
installment payment agreement with a person for the payment of any
fees due, together with interest thereon and any applicable
penalties, in installments over an agreed period.  With mutual
consent, the board and the fee payer may alter or modify the
agreement.
   (b) Upon failure of a person to fully comply with the terms of an
installment payment agreement with the board, the board may terminate
the agreement by mailing a notice of termination to the person.  The
notice shall include an explanation of the basis for the termination
and inform the person of his or her right to request an
administrative review of the termination.  Fifteen days after the
mailing of the notice, the installment payment agreement shall be
void, and the total amount of the fee, interest, and penalties due
shall be immediately payable.
   (c) The board shall establish procedures for an administrative
review for persons requesting that review whose installment payment
agreements are terminated under subdivision (b).  The collection of
fees, interest, and penalties that are the subject of the terminated
installment payment agreement may not be stayed during this
administrative review process.
   (d) Subdivision (b) shall not apply to any case where the board
finds collection of the fee to be in jeopardy.
  SEC. 54.  Section 45752 is added to the Revenue and Taxation Code,
to read:
   45752.  (a) Notwithstanding any other provision of this part, if
the board finds that neither the person liable for payment of fee nor
any party related to that person has in any way caused an erroneous
refund for which an action for recovery is provided under Section
45751, no interest shall be imposed on the amount of that erroneous
refund until 30 days after the date on which the board mails a notice
of determination for repayment of the erroneous refund to the
person.  The act of filing a claim for refund shall not be considered
as causing the erroneous refund.
   (b) This section shall be operative for any action for recovery
under Section 45751 on or after January 1, 2000.
  SEC. 55.  Section 45858 of the Revenue and Taxation Code is amended
to read:
   45858.  (a) The board shall develop and implement an education and
information program directed at, but not limited to, all of the
following groups:
   (1) Fee payers newly registered with the board.
   (2) Board audit and compliance staff.
   (b) The education and information program shall include all of the
following:
   (1) A program of written communication with newly registered fee
payers explaining in simplified terms their duties and
responsibilities.
   (2) Participation in seminars and similar programs organized by
federal, state, and local agencies.
   (3) Revision of fee payer educational materials currently produced
by the board that explain the most common areas of fee payer
nonconformance in simplified terms.
   (4) Implementation of a continuing education program for audit and
compliance personnel to include the application of new legislation
to fee payer activities and areas of recurrent fee payer
noncompliance or inconsistency of administration.
   (c) Electronic media used pursuant to this section shall not
represent the voice, picture, or name of members of the board or of
the Controller.
  SEC. 56.  Section 45865 of the Revenue and Taxation Code is amended
to read:
   45865.  (a) Every fee payer is entitled to be reimbursed for any
reasonable fees and expenses related to a hearing before the board if
all of the following conditions are met:
   (1) The fee payer files a claim for the fee and expenses with the
board within one year of the date the decision of the board becomes
final.
   (2) The board, in its sole discretion, finds that the action taken
by the board staff was unreasonable.
   (3) The board decides that the fee payer be awarded a specific
amount of fees and expenses related to the hearing, in an amount
determined by the board in its sole discretion.
   (b) To determine whether the board staff has been unreasonable,
the board shall consider whether the board staff has established that
its position was substantially justified.
   (c) The amount of reimbursed fees and expenses shall be limited to
the following:
   (1) Fees and expenses incurred after the date of filing petitions
for redetermination and claims for refund.
   (2) If the board finds that the staff was unreasonable with
respect to certain issues but reasonable with respect to other
issues, the amount of reimbursed fees and expenses shall be limited
to those that relate to the issues where the staff was unreasonable.

   (d) Any proposed award by the board pursuant to subdivision (a)
shall be available as a public record for at least 10 days prior to
the effective date of the award.
   (e) The amendments to this section by the act adding this
subdivision shall be operative for claims filed on or after January
1, 2000.
  SEC. 57.  Section 45868.5 is added to the Revenue and Taxation
Code, to read:
   45868.5.  (a) Except in any case where the board finds collection
of the tax to be in jeopardy, if any property has been levied upon,
the property or the proceeds from the sale of the property shall be
returned to the taxpayer if the board determines any one of the
following:
   (1) The levy on the property was not in accordance with the law.
   (2) The taxpayer has entered into and is in compliance with an
installment payment agreement pursuant to Section 45609 to satisfy
the tax liability for which the levy was imposed, unless that or
another agreement allows for the levy.
   (3) The return of the property will facilitate the collection of
the tax liability or will be in the best interest of the state and
the taxpayer.
   (b) Property returned under paragraphs (1) and (2) of subdivision
(a) is subject to the provisions of Section 45870.
  SEC. 58.  Section 45871 of the Revenue and Taxation Code is amended
to read:
   45871.  (a) At least 30 days prior to the filing or recording of
liens under Chapter 14 (commencing with Section 7150) or Chapter 14.5
(commencing with Section 7220) of Division 7 of Title 1 of the
Government Code, the board shall mail to the fee payer a preliminary
notice.  The notice shall specify the statutory authority of the
board for filing or recording the lien, indicate the earliest date on
which the lien may be filed or recorded, and state the remedies
available to the fee payer to prevent the filing or recording of the
lien.  In the event fee liens are filed for the same liability in
multiple counties, only one preliminary notice shall be sent.
   (b) The preliminary notice required by this section shall not be
required with respect to jeopardy determinations issued under Article
4 (commencing with Section 45351) of Chapter 3.
   (c) If the board determines that the filing of a lien was in
error, it shall mail a release to the fee payer and the entity
recording the lien as soon as possible, but no later than seven days,
after this determination and receipt of lien recording information.
The release shall contain a statement that the lien was filed in
error.  In the event the erroneous lien is obstructing a lawful
transaction, the board shall immediately issue a release of lien to
the fee payer and the entity recording the lien.
   (d) When the board releases a lien that has been erroneously
filed, notice of that release shall be mailed to the fee payer and,
upon the request of the fee payer, a copy of the release shall be
mailed to the major credit reporting companies in the county where
the lien was filed.
   (e) The board may release or subordinate a lien if the board
determines that the release or subordination will facilitate the
collection of the fee liability or will be in the best interest of
the state and the fee payer.
  SEC. 59.  Section 46157.5 is added to the Revenue and Taxation
Code, to read:
   46157.5.  (a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by Sections 46155 and 46253
where the failure to pay fees is due in whole or in part to an
unreasonable error or delay by an employee of the board acting in his
or her official capacity.
   (b) For purposes of this section, an error or delay shall be
deemed to have occurred only if no significant aspect of the error or
delay is attributable to an act of, or a failure to act by, the fee
payer.
   (c) Any person seeking relief under this section shall file with
the board a statement under penalty of perjury setting forth the
facts on which the claim for relief is based and any other
information which the board may require.
   (d) The board may grant relief only for interest imposed on fee
liabilities that arise during fee periods commencing on or after
January 1, 2000.
  SEC. 60.  Section 46464 is added to the Revenue and Taxation Code,
to read:
   46464.  (a) The board may, in its discretion, enter into a written
installment payment agreement with a person for the payment of any
fees due, together with interest thereon and any applicable
penalties, in installments over an agreed period.  With mutual
consent, the board and the fee payer may alter or modify the
agreement.
   (b) Upon failure of a person to fully comply with the terms of an
installment payment agreement with the board, the board may terminate
the agreement by mailing a notice of termination to the person.  The
notice shall include an explanation of the basis for the termination
and inform the person of his or her right to request an
administrative review of the termination.  Fifteen days after the
mailing of the notice, the installment payment agreement shall be
void, and the total amount of the fees, interest, and penalties due
shall be immediately payable.
   (c) The board shall establish procedures for an administrative
review for persons requesting that review whose installment payment
agreements are terminated under subdivision (b).  The collection of
fees, interest, and penalties that are the subject of the terminated
installment payment agreement may not be stayed during this
administrative review process.
   (d) Subdivision (b) shall not apply to any case where the board
finds collection of the fee to be in jeopardy.
  SEC. 61.  Section 46544 is added to the Revenue and Taxation Code,
to read:
   46544.  (a) Notwithstanding any other provision of this part, if
the board finds that neither the person liable for payment of fees
nor any party related to that person has in any way caused an
erroneous refund for which an action for recovery is provided under
Section 46541, no interest shall be imposed on the amount of that
erroneous refund until 30 days after the date on which the board
mails a notice of determination for repayment of the erroneous refund
to the person.  The act of filing a claim for refund shall not be
considered as causing the erroneous refund.
   (b) This section shall be operative for any action for recovery
under Section 46541 on or after January 1, 2000.
  SEC. 62.  Section 46613 of the Revenue and Taxation Code is amended
to read:
   46613.  (a) The board shall develop and implement an education and
information program directed at, but not limited to, all of the
following groups:
   (1) Fee payers newly registered with the board.
   (2) Board audit and compliance staff.
   (b) The education and information program shall include all of the
following:
   (1) A program of written communication with newly registered fee
payers explaining in simplified terms their duties and
responsibilities.
   (2) Participation in seminars and similar programs organized by
federal, state, and local agencies.
   (3) Revision of fee payer educational materials currently produced
by the board that explain the most common areas of fee payer
nonconformance in simplified terms.
   (4) Implementation of a continuing education program for audit and
compliance personnel to include the application of new legislation
to fee payer activities and areas
          of recurrent fee payer noncompliance or inconsistency of
administration.
   (c) Electronic media used pursuant to this section shall not
represent the voice, picture, or name of members of the board or of
the Controller.
  SEC. 63.  Section 46620 of the Revenue and Taxation Code is amended
to read:
   46620.  (a) Every fee payer is entitled to be reimbursed for any
reasonable fees and expenses related to a hearing before the board if
all of the following conditions are met:
   (1) The fee payer files a claim for the fee and expenses with the
board within one year of the date the decision of the board becomes
final.
   (2) The board, in its sole discretion, finds that the action taken
by the board staff was unreasonable.
   (3) The board decides that the fee payer be awarded a specific
amount of fees and expenses related to the hearing, in an amount
determined by the board in its sole discretion.
   (b) To determine whether the board staff has been unreasonable,
the board shall consider whether the board staff has established that
its position was substantially justified.
   (c) The amount of reimbursed fees and expenses shall be limited to
the following:
   (1) Fees and expenses incurred after the date of filing petitions
for redetermination and claims for refund.
   (2) If the board finds that the staff was unreasonable with
respect to certain issues but reasonable with respect to other
issues, the amount of reimbursed fees and expenses shall be limited
to those that relate to the issues where the staff was unreasonable.

   (d) Any proposed award by the board pursuant to this section shall
be available as a public record for at least 10 days prior to the
effective date of the award.
   (e) The amendments to this section by the act adding this
subdivision shall be operative for claims filed on or after January
1, 2000.
  SEC. 64.  Section 46623.5 is added to the Revenue and Taxation
Code, to read:
   46623.5.  (a) Except in any case where the board finds collection
of the fee to be in jeopardy, if any property has been levied upon,
the property or the proceeds from the sale of the property shall be
returned to the fee payer if the board determines any one of the
following:
   (1) The levy on the property was not in accordance with the law.
   (2) The fee payer has entered into and is in compliance with an
installment payment agreement pursuant to Section 46464 to satisfy
the fee liability for which the levy was imposed, unless that or
another agreement allows for the levy.
   (3) The return of the property will facilitate the collection of
the fee liability or will be in the best interest of the state and
the fee payer.
   (b) Property returned under paragraphs (1) and (2) of subdivision
(a) is subject to the provisions of Section 46625.
  SEC. 65.  Section 46626 of the Revenue and Taxation Code is amended
to read:
   46626.  (a) At least 30 days prior to the filing or recording of a
lien pursuant to either Chapter 14 (commencing with Section 7150) or
Chapter 14.5 (commencing with Section 7220) of Division 7 of Title 1
of the Government Code, the board shall mail to the fee payer a
preliminary notice of lien.  The notice shall specify the board's
statutory authority for filing or recording the lien, the earliest
date on which the lien may be filed or recorded, and the remedies
available to the fee payer to prevent the filing or recording of the
lien.  In the event liens are filed for the same liability in
multiple counties, only one preliminary notice shall be sent.
   (b) The preliminary notice required by this section shall not
apply to jeopardy determinations issued under Article 4 (commencing
with Section 46301) of Chapter 3.
   (c) If the board determines that a lien was recorded in error, it
shall mail a release to the fee payer and the entity that recorded
the lien as soon as possible, but in no event later than seven days
after this determination and the receipt of lien recording
information.  The release shall contain a statement that the lien was
filed in error.  In the event the erroneously recorded lien is
obstructing a lawful transaction, the board shall immediately issue a
release of lien to the fee payer and the entity that recorded the
lien.
   (d) Upon issuing a release pursuant to subdivision (c), notice of
that release shall be mailed to the taxpayer.  Upon the request of
the taxpayer, a copy of the release shall be mailed to the major
credit reporting companies in the county where the lien was recorded.

   (e) The board may release or subordinate a lien if the board
determines that the release or subordination will facilitate the
collection of the fee liability or will be in the best interest of
the state and the fee payer.
  SEC. 66.  Section 50112.2 of the Revenue and Taxation Code is
amended to read:
   50112.2.  (a) If the board finds that a person's failure to make a
timely report or payment is due to reasonable cause and
circumstances beyond the person's control, and occurred
notwithstanding the exercise of ordinary care and the absence of
willful neglect, the person may be relieved of the penalty provided
by Sections 50112 and 50119.
   (b) Any person seeking to be relieved of the penalty shall file
with the board a statement, under penalty of perjury, setting forth
the facts upon which he or she bases his or her claim for relief.
  SEC. 67.  Section 50112.4 is added to the Revenue and Taxation
Code, to read:
   50112.4.  (a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by Section 50112.1 and may
relieve all or any part of the interest imposed on a person by
Section 50113 when the deficiency determination is made because no
return was filed or payment of the fee was not made timely, or where
the failure to pay fees is due in whole or in part to an unreasonable
error or delay by an employee of the board acting in his or her
official capacity.
   (b) For purposes of this section, an error or delay shall be
deemed to have occurred only if no significant aspect of the error or
delay is attributable to an act of, or a failure to act by, the fee
payer.
   (c) Any person seeking relief under this section shall file with
the board a statement under penalty of perjury setting forth the
facts on which the claim for relief is based and any other
information which the board may require.
   (d) The board may grant relief only for interest imposed on fee
liabilities that arise during taxable periods commencing on or after
January 1, 2000.
  SEC. 68.  Section 50138.6 is added to the Revenue and Taxation
Code, to read:
   50138.6.  (a) The board may, in its discretion, enter into a
written installment payment agreement with a person for the payment
of any fees due, together with interest thereon and any applicable
penalties, in installments over an agreed period.  With mutual
consent, the board and the fee payer may alter or modify the
agreement.
   (b) Upon failure of a person to fully comply with the terms of an
installment payment agreement with the board, the board may terminate
the agreement by mailing a notice of termination to the person.  The
notice shall include an explanation of the basis for the termination
and inform the person of his or her right to request an
administrative review of the termination.  Fifteen days after the
mailing of the notice, the installment payment agreement shall be
void, and the total amount of the fees, interest, and penalties due
shall be immediately payable.
   (c) The board shall establish procedures for an administrative
review for persons requesting that review whose installment payment
agreements are terminated under subdivision (b).  The collection of
fees, interest, and penalties that are the subject of the terminated
installment payment agreement may not be stayed during this
administrative review process.
   (d) Subdivision (b) shall not apply to any case where the board
finds collection of the fee to be in jeopardy.
  SEC. 69.  Section 50150.5 is added to the Revenue and Taxation
Code, to read:
   50150.5.  (a) Notwithstanding any other provision of this part, if
the board finds that neither the person liable for payment of fees
nor any party related to that person has in any way caused an
erroneous refund for which an action for recovery is provided under
Section 50150, no interest shall be imposed on the amount of that
erroneous refund until 30 days after the date on which the board
mails a notice of determination for repayment of the erroneous refund
to the person.  The act of filing a claim for refund shall not be
considered as causing the erroneous refund.
   (b) This section shall be operative for any action for recovery
under Section 50150 on or after January 1, 2000.
  SEC. 70.  Section 50156.2 of the Revenue and Taxation Code is
amended to read:
   50156.2.  (a) The board shall develop and implement an education
and information program directed at, but not limited to, all of the
following groups:
   (1) Fee payers newly registered with the board.
   (2) Board audit and compliance staff.
   (b) The education and information program shall include all of the
following:
   (1) A program of written communication with newly registered fee
payers explaining in simplified terms their duties and
responsibilities.
   (2) Participation in seminars and similar programs organized by
federal, state, and local agencies.
   (3) Revision of fee payer educational materials currently produced
by the board that explain the most common areas of fee payer
nonconformance in simplified terms.
   (4) Implementation of a continuing education program for audit and
compliance personnel to include the application of new legislation
to fee payer activities, and areas of recurrent fee payer
noncompliance or inconsistency of administration.
   (c) Electronic media used to comply with this section shall not
represent the voice, picture, or name of members of the board or the
Controller.
  SEC. 71.  Section 50156.9 of the Revenue and Taxation Code is
amended to read:
   50156.9.  (a) Every fee payer is entitled to be reimbursed for any
reasonable fees and expenses related to a hearing before the board
if all of the following conditions are met:
   (1) The fee payer files a claim for the fee and expenses with the
board within one year of the date the decision of the board becomes
final.
   (2) The board, in its sole discretion, finds that the action taken
by the board staff was unreasonable.
   (3) The board decides that the fee payer be awarded a specific
amount of fees and expenses related to the hearing, in an amount
determined by the board in its sole discretion.
   (b) To determine whether the board staff has been unreasonable,
the board shall consider whether the board staff has established that
its position was substantially justified.
   (c) The amount of reimbursed fees and expenses shall be limited to
the following:
   (1) Fees and expenses incurred after the date of filing petitions
for redetermination and claims for refund.
   (2) If the board finds that the staff was unreasonable with
respect to certain issues but reasonable with respect to other
issues, the amount of reimbursed fees and expenses shall be limited
to those that relate to the issues where the staff was unreasonable.

   (d) Any proposed award by the board pursuant to subdivision (a)
shall be available as a public record for at least 10 days prior to
the effective date of the award.
   (e) The amendments to this section by the act adding this
subdivision shall be operative for claims filed on or after January
1, 2000.
  SEC. 72.  Section 50156.15 of the Revenue and Taxation Code is
amended to read:
   50156.15.  (a) At least 30 days prior to the filing or recording
of liens under Chapter 14 (commencing with Section 7150) or Chapter
14.5 (commencing with Section 7220) of Division 7 of Title 1 of the
Government Code, the board shall mail to the fee payer a preliminary
notice.  The notice shall specify the statutory authority of the
board for filing or recording the lien, indicate the earliest date on
which the lien may be filed or recorded, and state the remedies
available to the fee payer to prevent the filing or recording of the
lien.  In the event fee liens are filed for the same liability in
multiple counties, only one preliminary notice shall be sent.
   (b) The preliminary notice required by this section shall not be
required with respect to jeopardy determinations issued under Article
4 (commencing with Section 50120.1) of Chapter 3.
   (c) If the board determines that the filing of a lien was in
error, it shall mail a release to the fee payer and the entity
recording the lien as soon as possible, but no later than seven days,
after this determination and receipt of lien recording information.
The release shall contain a statement that the lien was filed in
error.  In the event the erroneous lien is obstructing a lawful
transaction, the board shall immediately issue a release of lien to
the fee payer and the entity recording the lien.
   (d) When the board releases a lien that has been erroneously
filed, notice of that release shall be mailed to the fee payer and,
upon the request of the fee payer, a copy of the release shall be
mailed to the major credit reporting companies in the county where
the lien was filed.
   (e) The board may release or subordinate a lien if the board
determines that the release or subordination will facilitate the
collection of the fee liability or will be in the best interest of
the state and the fee payer.
  SEC. 73.  Section 50156.17 is added to the Revenue and Taxation
Code, to read:
   50156.17.  (a) Except in any case where the board finds collection
of the fee to be in jeopardy, if any property has been levied upon,
the property or the proceeds from the sale of the property shall be
returned to the fee payer if the board determines any one of the
following:
   (1) The levy on the property was not in accordance with the law.
   (2) The fee payer has entered into and is in compliance with an
installment payment agreement pursuant to Section 50138.6 to satisfy
the fee liability for which the levy was imposed, unless that or
another agreement allows for the levy.
   (3) The return of the property will facilitate the collection of
the fee liability or will be in the best interest of the state and
the fee payer.
   (b) Property returned under paragraphs (1) and (2) of subdivision
(a) is subject to the provisions of Section 50156.14.
  SEC. 74.  Section 55046 is added to the Revenue and Taxation Code,
to read:
   55046.  (a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by Section 55043 and may
relieve all or any part of the interest imposed on a person by
Section 55061 when the deficiency determination is made because no
return was filed or payment of the fee was not made timely, or where
the failure to pay fees is due in whole or in part to an unreasonable
error or delay by an employee of the board acting in his or her
official capacity.
   (b) For purposes of this section, an error or delay shall be
deemed to have occurred only if no significant aspect of the error or
delay is attributable to an act of, or a failure to act by, the fee
payer.
   (c) Any person seeking relief under this section shall file with
the board a statement under penalty of perjury setting forth the
facts on which the claim for relief is based and any other
information which the board may require.
   (d) The board may grant relief only for interest imposed on fee
liabilities that arise during taxable periods commencing on or after
January 1, 2000.
  SEC. 75.  Section 55209 is added to the Revenue and Taxation Code,
to read:
   55209.  (a) The board may, in its discretion, enter into a written
installment payment agreement with a person for the payment of any
fees due, together with interest thereon and any applicable
penalties, in installments over an agreed period.  With mutual
consent, the board and the fee payer may alter or modify the
agreement.
   (b) Upon failure of a person to fully comply with the terms of an
installment payment agreement with the board, the board may terminate
the agreement by mailing a notice of termination to the person.  The
notice shall include an explanation of the basis for the termination
and inform the person of his or her right to request an
administrative review of the termination.  Fifteen days after the
mailing of the notice, the installment payment agreement shall be
void, and the total amount of the fees, interest, and penalties due
shall be immediately payable.
   (c) The board shall establish procedures for an administrative
review for persons requesting that review whose installment payment
agreements are terminated under subdivision (b).  The collection of
fees, interest, and penalties that are the subject of the terminated
installment payment agreement may not be stayed during this
administrative review process.
   (d) Subdivision (b) shall not apply to any case where the board
finds collection of the fee to be in jeopardy.
  SEC. 76.  Section 55262 is added to the Revenue and Taxation Code,
to read:
   55262.  (a) Notwithstanding any other provision of this part, if
the board finds that neither the person liable for payment of fees
nor any party related to that person has in any way caused an
erroneous refund for which an action for recovery is provided under
Section 55261, no interest shall be imposed on the amount of that
erroneous refund until 30 days after the date on which the board
mails a notice of determination for repayment of the erroneous refund
to the person.  The act of filing a claim for refund shall not be
considered as causing the erroneous refund.
   (b) This section shall be operative for any action for recovery
under Section 55261 on or after January 1, 2000.
  SEC. 77.  Section 55323 of the Revenue and Taxation Code is amended
to read:
   55323.  (a) The board shall develop and implement an education and
information program directed at, but not limited to, all of the
following groups:
   (1) Taxpayers newly registered with the board.
   (2) Board audit and compliance staff.
   (b) The education and information program shall include all of the
following:
   (1) A program of written communication with newly registered
taxpayers explaining in simplified terms their duties and
responsibilities.
   (2) Participation in seminars and similar programs organized by
federal, state, and local agencies.
   (3) Revision of taxpayer educational materials currently produced
by the board that explain the most common areas of taxpayer
nonconformance in simplified terms.
   (4) Implementation of a continuing education program for audit and
compliance personnel to include the application of new legislation
to taxpayer activities and areas of recurrent taxpayer noncompliance
of inconsistency of administration.
   (c) Electronic media used pursuant to this section shall not
represent the voice, picture, or name of members of the board or of
the Controller.
  SEC. 78.  Section 55330 of the Revenue and Taxation Code is amended
to read:
   55330.  (a) Every taxpayer is entitled to be reimbursed for any
reasonable fees and expenses related to a hearing before the board if
all of the following conditions are met:
   (1) The taxpayer files a claim for the fees and expenses with the
board within one year of the date the decision of the board becomes
final.
   (2) The board, in its sole discretion, finds that the action taken
by the board staff was unreasonable.
   (3) The board decides that the taxpayer be awarded a specific
amount of fees and expenses related to the hearing, in an amount
determined by the board in its sole discretion.
   (b) To determine whether the board staff has been unreasonable,
the board shall consider whether the board staff has established that
its position was substantially justified.
   (c) The amount of reimbursed fees and expenses shall be limited to
the following:
   (1) Fees and expenses incurred after the date of filing petitions
for redetermination and claims for refund.
   (2) If the board finds that the staff was unreasonable with
respect to certain issues but reasonable with respect to other
issues, the amount of reimbursed fees and expenses shall be limited
to those that relate to the issues where the staff was found
unreasonable.
   (d) Any proposed award by the board pursuant to this section shall
be available as a public record for at least 10 days prior to the
effective date of the award.
   (e) The amendments to this section by the act adding this
subdivision shall be operative for claims filed on or after January
1, 2000.
  SEC. 79.  Section 55333.5 is added to the Revenue and Taxation
Code, to read:
   55333.5.  (a) Except in any case where the board finds collection
of the fee to be in jeopardy, if any property has been levied upon,
the property or the proceeds from the sale of the property shall be
returned to the fee payer if the board determines any one of the
following:
   (1) The levy on the property was not in accordance with the law.
   (2) The fee payer has entered into and is in compliance with an
installment payment agreement pursuant to Section 55209 to satisfy
the fee liability for which the levy was imposed, unless that or
another agreement allows for the levy.
   (3) The return of the property will facilitate the collection of
the fee liability or will be in the best interest of the state and
the fee payer.
   (b) Property returned under paragraphs (1) and (2) of subdivision
(a) is subject to the provisions of Section 55335.
  SEC. 80.  Section 55336 of the Revenue and Taxation Code is amended
to read:
   55336.  (a) At least 30 days prior to the filing or recording of
liens under Chapter 14 (commencing with Section 7150) or Chapter 14.5
(commencing with Section 7220) of Division 7 of Title 1 of the
Government Code, the board shall mail to the taxpayer a preliminary
notice.  The notice shall specify the statutory authority of the
board for filing or recording the lien, indicate the earliest date on
which the lien may be filed or recorded, and state the remedies
available to the taxpayer to prevent the filing or recording of the
lien.  In the event tax liens are filed for the same liability in
multiple counties, only one preliminary notice shall be sent.
   (b) The preliminary notice required by this section shall not
apply to jeopardy determinations issued under Article 4 (commencing
with Section 55101) of Chapter 3.
   (c) If the board determines that filing a lien was in error, it
shall mail a release to the taxpayer and the entity recording the
lien as soon as possible, but not later than seven days, after this
determination and receipt of lien recording information.  The release
shall contain a statement that the lien was filed in error.  In the
event the erroneous lien is obstructing a lawful transaction, the
board shall immediately issue a release of lien to the taxpayer and
the entity recording the lien.
   (d) When the board releases a lien erroneously filed, notice of
that fact shall be mailed to the taxpayer and, upon the request of
the taxpayer, a copy of the release shall be mailed to the major
credit reporting companies in the county where the lien was filed.
   (e) The board may release or subordinate a lien if the board
determines that the release or subordination will facilitate the
collection of the tax liability or will be in the best interest of
the state and the taxpayer.
  SEC. 81.  Section 60212 is added to the Revenue and Taxation Code,
to read:
   60212.  (a) The board, in its discretion, may relieve all or any
part of the interest imposed on a person by Sections 60207 and 60302
where the failure to pay tax is due in whole or in part to an
unreasonable error or delay by an employee of the board acting in his
or her official capacity.
   (b) For purposes of this section, an error or delay shall be
deemed to have occurred only if no significant aspect of the error or
delay is attributable to an act of, or a failure to act by, the
taxpayer.
   (c) Any person seeking relief under this section shall file with
the board a statement under penalty of perjury setting forth the
facts on which the claim for relief is based and any other
information which the board may require.
   (d) The board may grant relief only for interest imposed on tax
liabilities that arise during taxable periods commencing on or after
January 1, 2000.
  SEC. 82.  Section 60493 is added to the Revenue and Taxation Code,
to read:
   60493.  (a) The board may, in its discretion, enter into a written
installment payment agreement with a person for the payment of any
taxes due, together with interest thereon and any applicable
penalties, in installments over an agreed period.  With mutual
consent, the board and the taxpayer may alter or modify the
agreement.
   (b) Upon failure of a person to fully comply with the terms of an
installment payment agreement with the board, the board may terminate
the agreement by mailing a notice of termination to the person.  The
notice shall include an explanation of the basis for the termination
and inform the person of his or her right to request an
administrative review of the termination.  Fifteen days after the
mailing of the notice, the installment payment agreement shall be
void, and the total amount of the tax, interest, and penalties due
shall be immediately payable.
   (c) The board shall establish procedures for an administrative
review for persons requesting that review whose installment payment
agreements are terminated under subdivision (b).  The collection of
taxes, interest, and penalties that are the subject of the terminated
installment payment agreement may not be stayed during this
administrative review process.
   (d) Subdivision (b) shall not apply to any case where the board
finds collection of the tax to be in jeopardy.
  SEC. 83.  Section 60564 is added to the Revenue and Taxation Code,
to read:
   60564.  (a) Notwithstanding any other provision of this part, if
the board finds that neither the person liable for payment of tax nor
any party related to that person has in any way caused an erroneous
refund for which an action for recovery is provided under Section
60561, no interest shall be imposed on the amount of that erroneous
refund until 30 days after the date on which the board mails a notice
of determination for repayment of the erroneous refund to the
person.  The act of filing a claim for refund shall not be considered
as causing the erroneous refund.
                                        (b) This section shall be
operative for any action for recovery under Section 60561 on or after
January 1, 2000.
  SEC. 84.  Section 60623 of the Revenue and Taxation Code is amended
to read:
   60623.  (a) The board shall develop and implement an education and
information program directed at, but not limited to, all of the
following groups:
   (1) Taxpayers newly registered with the board.
   (2) Board audit and compliance staff.
   (b) The education and information program shall include all of the
following:
   (1) A program of written communication with newly registered
taxpayers explaining in simplified terms their duties and
responsibilities.
   (2) Participation in seminars and similar programs organized by
federal, state, and local agencies.
   (3) Revision of taxpayer educational materials currently produced
by the board that explain the most common areas of taxpayer
nonconformance in simplified terms.
   (4) Implementation of a continuing education program for audit and
compliance personnel to include the application of new legislation
to taxpayer activities and areas of recurrent taxpayer noncompliance
or inconsistency of administration.
   (c) Electronic media used pursuant to this section shall not
represent the voice, picture, or name of members of the board or of
the Controller.
  SEC. 85.  Section 60630 of the Revenue and Taxation Code is amended
to read:
   60630.  (a) Every taxpayer is entitled to be reimbursed for any
reasonable fees and expenses related to a hearing before the board if
all of the following conditions are met:
   (1) The taxpayer files a claim for the fee and expenses with the
board within one year of the date the decision of the board becomes
final.
   (2) The board, in its sole discretion, finds that the action taken
by the board staff was unreasonable.
   (3) The board decides that the taxpayer shall be awarded a
specific amount of fees and expenses related to the hearing, in an
amount determined by the board in its sole discretion.
   (b) To determine whether the board staff has been unreasonable,
the board shall consider whether the board staff has established that
its position was substantially justified.
   (c) The amount of reimbursed fees and expenses shall be limited to
the following:
   (1) Fees and expenses incurred after the date of filing petitions
for redetermination and claims for refund.
   (2) If the board finds that the staff was unreasonable with
respect to certain issues but reasonable with respect to other
issues, the amount of reimbursed fees and expenses shall be limited
to those that relate to the issues where the staff was unreasonable.

   (d) The board's proposed award under this section shall be
available as a public record for at least 10 days prior to the
effective date of the award.
   (e) The amendments to this section by the act adding this
subdivision shall be operative for claims filed on or after January
1, 2000.
  SEC. 86.  Section 60632.1 is added to the Revenue and Taxation
Code, to read:
   60632.1.  (a) Except in any case where the board finds collection
of the tax to be in jeopardy, if any property has been levied upon,
the property or the proceeds from the sale of the property shall be
returned to the taxpayer if the board determines any one of the
following:
   (1) The levy on the property was not in accordance with the law.
   (2) The taxpayer has entered into and is in compliance with an
installment payment agreement pursuant to Section 60493 to satisfy
the tax liability for which the levy was imposed, unless that or
another agreement allows for the levy.
   (3) The return of the property will facilitate the collection of
the tax liability or will be in the best interest of the state and
the taxpayer.
   (b) Property returned under paragraphs (1) and (2) of subdivision
(a) is subject to the provisions of Section 60633.1.
  SEC. 87.  Section 60633.1 is added to the Revenue and Taxation
Code, to read:
   60633.1.  (a) A taxpayer may file a claim with the board for
reimbursement of bank charges incurred by the taxpayer as the direct
result of an erroneous levy or notice to withhold by the board.  Bank
charges include a financial institution's customary charge for
complying with the levy or notice to withhold instructions and
reasonable charges for overdrafts that are a direct consequence of
the erroneous levy or notice to withhold.  The charges are those paid
by the taxpayer and not waived for reimbursement by the financial
institution.  Each claimant applying for reimbursement shall file a
claim with the board that shall be in a form as may be prescribed by
the board.  In order for the board to grant a claim, the board shall
determine that both of the following conditions have been satisfied:

   (1) The erroneous levy or notice to withhold was caused by board
error.
   (2) Prior to the levy or notice to withhold, the taxpayer
responded to all contacts by the board and provided the board with
any requested information or documentation sufficient to establish
the taxpayer's position.  This provision may be waived by the board
for reasonable cause.
   (b) Claims pursuant to this section shall be filed within 90 days
from the date of the levy or notice to withhold.  Within 30 days from
the date the claim is received, the board shall respond to the
claim.  If the board denies the claim, the taxpayer shall be notified
in writing of the reason or reasons for the denial of the claim.
  SEC. 88.  Section 60633.2 is added to the Revenue and Taxation
Code, to read:
   60633.2.  (a) At least 30 days prior to the filing or recording of
liens under Chapter 14 (commencing with Section 7150) or Chapter
14.5 (commencing with Section 7220) of Division 7 of Title 1 of the
Government Code, the board shall mail to the taxpayer a preliminary
notice.  The notice shall specify the statutory authority of the
board for filing or recording the lien, indicate the earliest date on
which the lien may be filed or recorded, and state the remedies
available to the taxpayer to prevent the filing or recording of the
lien.  In the event the tax liens are filed for the same liability in
multiple counties, only one preliminary notice shall be sent.
   (b) The preliminary notice required by this action shall not apply
to jeopardy determinations issued under Article 4 (commencing with
Section 60330) of Chapter 6.
   (c) If the board determines that filing a lien was in error, it
shall mail a release to the taxpayer and the entity recording the
lien as soon as possible, but no later than seven days, after this
determination and receipt of lien recording information.  The release
shall contain a statement that the lien was filed in error.  In the
event the erroneous lien is obstructing a lawful transaction, the
board shall immediately issue a release of lien to the taxpayer and
the entity recording the lien.
   (d) When the board releases a lien erroneously filed, notice of
that fact shall be mailed to the taxpayer and, upon the request of
the taxpayer, a copy of the release shall be mailed to the major
credit reporting companies in the county where the lien was filed.
   (e) The board may release or subordinate a lien if the board
determines that the release or subordination will facilitate the
collection of the tax liability or will be in the best interest of
the state and the taxpayer.
